NEW YORK/LONDON - Rupert Murdoch's News Corp took a major step in satisfying shareholders' concerns for a more growth-focused business with a plan to separate its publishing and entertainment assets, but an uncertain management structure for the two proposed companies raises new questions about a succession plan at the family-controlled media empire.

Shareholders have been pressing News Corp to get rid of its troubled newspapers business after a phone hacking scandal tainted its British newspapers and forced the company to drop its proposed acquisition of pay-TV group BSkyB. The move would be a clear signal that the company is distancing itself from its newspaper roots.

The proposed split into two publicly-traded companies sent News Corp shares up more than 8%, or $1.68, to $21.76 on Nasdaq - their highest since 2007. Th e stock plummeted last year at the height of the hacking scandal, before recovering this year, helped by a $10 billion share buyback plan.

Several News Corp senior editors and publishers from around the world met with senior executives on Tuesday at the company's headquarters in midtown Manhattan to discuss details of the split, according to a person familiar with the matter. News of the meeting was first reported by the New York Times.

New Corp has retained investment banks Goldman Sachs and Blair Ephron's Centerview to handle the split process, according to people familiar with the plan. The possibility of breaking up News Corp has been under discussion for a "considerable period of time" but no final decision has been made, said a source with knowledge of the situation.

Cable business news network CNBC reported News Corp could announce details of its plans as soon as Thursday.

In a one-sentence statement, News Corp confirmed news reports that it is "considering a restructuring to separate its business into two distinct publicly traded companies." The conglomerate gave no other details.

Although The Wall Street Journal reported that the Murdoch family is expected to maintain majority control of both assets, the proposed split raises fresh questions about who will ultimately succeed Murdoch, 81, at the helm.

Many investors have said they favor Chief Operating Officer Chase Carey to take the chief executive job running the entertainment business, perhaps with Murdoch as chairman. According to one person familiar with the situation, a move to separate entertainment and publishing is being championed by Carey as a way to boost shareholder value.

Murdoch's children Elizabeth and James, both senior News Corp executives, are expected to stay with the entertainment unit.

James Murdoch has been campaigning for a position to run the TV operations, said a person close to the company. His older sister Elizabeth could take a chief operating officer role at the operations, this person said.

It is less clear who would run the publishing business, with options including Murdoch himself, the return of his eldest son Lachlan to an executive role, or Joel Klein, the head of News Corp's fledgling education business.

ANOTHER TILT AT BSKYB

Analysts believe investors and some management felt emboldened by the hacking scandal to push for a change.

But Carey as recently as last month said that management and the board had discussed spinning off the publishing business following investor pressure but did not have any plans to push ahead at that time.

Murdoch had earlier opposed a split, and as recently as May said the group was not considering spinning off its British newspapers to protect the rest of the empire.

But, according a separate source, "There became a moment when he started to realize this would be the best way to allow both businesses to grow in their own way."

The Australian-born Murdoch made his name by buying newspapers in Australia and then the News of the World, the Sun and the Times newspapers in Britain, and he talks often about his love for newspapers and the publishing industry.

London-based analyst Ian Whittaker at Liberum Capital said a spinoff of the publishing division could enable News Corp to make another bid for BSkyB once the hacking scandal died down.

"It makes sense, given that the newspaper part has been the scandal-hit element of the business," he said. "It also suggests that they may even have another tilt at Sky in the medium term. I imagine it would be seen as positive by the shareholders outside of the family."

News Corp pulled its $12 billion bid for the 61% of BSkyB it did not already own last July, after public outrage sparked by the admission that staff at the News of the World tabloid had repeatedly hacked into phones to source salacious stories.

LUCRATIVE ENTERTAINMENT UNIT

News Corp's film and television businesses include the 20th Century Fox film studio, Fox broadcasting network and Fox News channel. The entertainment business, which generated revenues of $23.5 billion in the year to June 2011, would dwarf the publishing unit, which posted $8.8 billion in revenue.

The publishing division includes the HarperCollins book publisher, the education arm headed by Klein, and newspapers including The Wall Street Journal, the Times of London, the Sun, the New York Post and The Australian.

Publishing, including integrated marketing services, accounts for around 7% of News Corp's enterprise value, according to analysts at Barclays Capital. It estimates that publishing represents 24% of revenues and around 11% of operating income.

Analysts estimate that an independent publishing division would generate about $1.3 billion in EBITDA at a multiple valuation of 6 times, or $3.25 per share. They expect a standalone entertainment unit to be valued at $52 billion, or $23 per share, based on an 8 times cash flow multiple.

News Corp's 39% stake in BSkyB came under scrutiny in the spring after a British parliamentary committee questioned whether Murdoch was "fit and proper" to run the business.

British regulator Ofcom is currently deliberating that point among others and is due to make a decision in coming weeks.

"It's about Ofcom deciding whether the company is fit and proper to hold a broadcast license," said Canaccord Genuity analyst Thomas Eagan. "This split would help ameliorate those concerns."

The hacking scandal reverberated throughout the wider New York-based media conglomerate and disrupted what was thought to have been a smooth plan for Murdoch to be succeeded as CEO by his youngest son, James.

It has also revealed the close relationships in Britain between the government and News Corp executives. Police have arrested over 50 News Corp staff and public officials while the former head of the British newspaper division Rebekah Brooks, a close confidante to Murdoch, is awaiting a trial for interfering with the police investigation.